Tesco raises profit guidance following strong sales

Tesco has raised its profit guidance after strong sales growth and a fall in food prices.

In the six months to 26 August, the supermarket said revenue grew by five per cent to £34.1 billion.

UK sales rose by 8.7 per cent over the same time period, while retail adjusted operating profit grew by 13.5 per cent to £1.4billion.

Tesco said it expects to deliver between £2.6 billion and £2.7 billion in retail adjusted operating profit for the 2023/24 financial year.

The supermarket added that it has cut prices on around 2,500 products to give customers an average saving of around 12 per cent. Shoppers using Tesco’s loyalty scheme can save up to £390 per year on around 8,000 products.

Away from the UK, profit in Central Europe fell almost 42 per cent to £46 million. This was largely driven by poor performance in Hungary, where numbers were impacted by currency devaluation and regulatory actions.

“We know how challenging it is for many households across the country, as they continue to grapple with ongoing cost of living pressures,” said Tesco chief executive Ken Murphy. “We are committed to doing everything we can to drive down food bills and Tesco is now consistently the cheapest full-line grocer.”

He added: “Our investments in value, and in improving more than 1,100 own brand products from pasta to fresh fish, are helping us to offer outstanding quality at great prices, all underpinned by market-leading availability. Customers are responding well, contributing to market share gains in store and online.”

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